PUBLIC DISCLOSURE COMMUNITY REINVESTMENT ACT PERFORMANCE EVALUATION

Transcription

1 PUBLIC DISCLOSURE April 1, 2013 COMMUNITY REINVESTMENT ACT PERFORMANCE EVALUATION 105 Washington Square Bucyrus, Ohio RSSD # Federal Reserve Bank of Cleveland P.O. Box 6387 Cleveland, Ohio NOTE: This document is an evaluation of this institution's record of meeting the credit needs of its entire community, including low- and moderate-income neighborhoods, consistent with the safe and sound operation of the institution. This evaluation is not, nor should it be construed as, an assessment of the financial condition of this institution. The rating assigned to this institution does not represent an analysis, conclusion, or opinion of the federal financial supervisory agency concerning the safety and soundness of this financial institution.

2 TABLE OF CONTENTS Institution s CRA Rating...1 Scope of Examination...2 Description of Institution...4 Description of Assessment Areas...6 Conclusions with Respect to Performance Tests...7 Nonmetropolitan Ohio (full-scope review) a. Description of Institution s Operations...11 b. Conclusions with Respect to Performance Tests...18 Columbus Metropolitan Statistical Area (full-scope review) a. Description of Institution s Operations...25 b. Conclusions with Respect to Performance Tests...32 Mansfield Metropolitan Statistical Area (limited-scope review) a. Description of Institution s Operations...37 b. Conclusions with Respect to Performance Tests...39 Appendices a. Assessment Area Maps...40 b. Lending Tables...43 c. Glossary of Terms...49 Table of Contents

3 INSTITUTION'S CRA RATING This Institution is rated: Satisfactory The Lending Test is rated: Satisfactory The Community Development Test is rated: Satisfactory The major factors and criteria contributing to this rating include: A reasonable loan-to-deposit ratio, given the bank s size, financial condition, and assessment area credit needs; A majority of loans and other lending-related activities are in the assessment area; The geographic distribution of loans reflects a reasonable dispersion throughout the assessment area; A reasonable penetration among individuals of different income levels (including low- and moderate-income individuals) and businesses of different sizes; No CRA-related complaints about the institution s performance in meeting the assessment area credit needs; and, The bank s community development performance demonstrates an adequate responsiveness to the community development needs of its assessment area, considering the bank s capacity and the need and availability of such opportunities in the bank s assessment area. The bank was evaluated as a small bank and was rated Satisfactory at the previous CRA evaluation dated January 10,

4 SCOPE OF EXAMINATION s (FCB) Community Reinvestment Act (CRA) performance was evaluated using the interagency intermediate small bank examination procedures under Regulation BB. FCB s CRA performance was evaluated based on lending data for the period of January 1, 2011 through December 31, The loan products evaluated included loans reported under the Home Mortgage Act (HMDA), small business loans, small farm loans, and consumer loans. Small business and small farm loans are comprised of loans secured and not secured by real estate. Mortgage loans are comprised of home purchase, refinance, home improvement, and multi-family dwelling loans, which were combined for this review due to a lack of volume. Consumer loans are comprised of motor vehicle, home equity lines of credit, and other secured and unsecured loans that were combined for this review due to a lack of volume. In addition, the bank s lending performance was compared to the 2011 aggregate performance of all lenders required to report HMDA and CRA data within the respective assessment areas. Due to the timing of this report, 2011 aggregate data was the most recent data available. Community development activities for the period between January 10, 2011 and April 1, 2013 were included in this evaluation. Specifically reviewed were community development loans, investments, and services occurring since the previous examination. FCB s assessment area for CRA purposes is comprised of the following three assessment areas and the review scope of each area was determined based on the volume of lending activity and deposit share: Nonmetropolitan Ohio full-scope evaluation Columbus Metropolitan Statistical Area full-scope evaluation Mansfield Metropolitan Statistical Area limited-scope evaluation A detailed description of each assessment area is presented in subsequent sections of this performance evaluation. Based on FCB s market share and lending volume, lending performance in nonmetropolitan Ohio received the greatest weight. Four community contact interviews were conducted to provide perspective on the credit needs of the assessment area in which the bank operates. Details from these interviews are presented within each of the respective assessment areas of this evaluation. The following table and charts illustrate the volume and distribution of loans originated within FCB s assessment area during the evaluation period: 2

5 Loan Type Number of Loans Dollar Amount of Loans (000s) Residential 89 $32,304 Small Business 43 $19,688 Small Farm 45 $10,469 Consumer 29 $ 1,035 Total Loans 206 $63,496 Originated Loans (#) Originated Loans ($) 2% 22% 14% 21% 43% Residential Small Business Small Farm Consumer 31% 16% 51% Residential Small Business Small Farm Consumer Based on total loan volume by number and dollar amount, residential lending received the greatest weight in this analysis, followed by small business lending. Consumer and small farm lending received the least weight and were only evaluated within the nonmetropolitan Ohio assessment area. For the purposes of this evaluation, FCB s distribution of lending to borrowers of different income levels was given most weight in the nonmetropolitan Ohio assessment area due to the limited number low- and moderate-income geographies within that assessment area. 3

6 DESCRIPTION OF INSTITUTION FCB is the sole subsidiary of Farmers Citizens Bancorp. Both the bank and the holding company are located in Bucyrus, Ohio. According to the December 31, 2012 Uniform Bank Performance Report (UBPR), FCB had total assets of $368 million, a 3.3% increase since the previous CRA evaluation. FCB serves its assessment areas through one main office and seven branch offices. In Crawford County, the main office and one branch office (both located in Bucyrus) each have a full-service ATM. FCB also has branch offices with full-service ATMs in Knox County (Fredericktown), Morrow County (Cardington), Richland County (Shiloh), and Holmes County (Mt. Hope). FCB has two offices in Franklin County (Worthington and Upper Arlington). Only the Upper Arlington office has a full-service ATM. Since the previous evaluation, the bank opened a nondeposit taking loan production office in Dublin, Ohio and a full-service branch in Mt. Hope, Ohio. As the Mt. Hope branch in Holmes County opened in February 2013 (which is outside of the review period), its performance will not be considered as part of this performance evaluation. FCB has not closed any branches since the previous evaluation. FCB is a full-service retail bank offering business and consumer deposit accounts and commercial, residential mortgage, and consumer loans. As of September 30, 2012, net loans and leases represents 64.6% of the bank s total assets. The following charts display the bank s loan portfolio composition and trend as of September 30, 2012: COMPOSITION OF LOAN PORTFOLIO 9/30/ /31/ /31/2010 Loan Type $ (000s) Percent $ (000s) Percent $ (000s) Percent Construction and Development % 2, % 6, % Secured by One- to Four- Family Dwellings 47, % 46, % 38, % Other Real Estate: Farmland 22, % 19, % 17, % Multifamily 36, % 19, % 16, % Nonfarm nonresidential 118, % 100, % 92, % Commercial and Industrial 5, % 6, % 6, % Loans to Individuals % % % Agricultural Loans 8, % 8, % 8, % Total $240, % $205, % $187, % * This table does not include the entire loan portfolio. Specifically, it excludes loans to depository institutions, bankers acceptances, lease financing receivables, obligations of state and political subdivisions, and other loans that do not meet any other category. Contra assets are also not included in this table. 4

7 12/31/ /31/2011 9/30/2012 Loan Portfolio Trend 60.0% 50.0% 49.1% 49.0% 49.2% 40.0% 30.0% 20.0% 10.0% 0.0% 3.7% 1.3% 0.3% Construction & Development 20.4% 22.9% 19.8% Secured by 1-4 Family Dwellings 9.4% 9.7% 9.4% 9.0% 9.7% 15.4% 3.2% 3.1% 2.3% Farmland Multifamily Nonfarm Commercial & Nonresidential Industrial 0.5% 0.2% 0.1% Loans to Individuals 4.7% 4.0% 3.5% Agricultural FCB s investment portfolio as of December 31, 2012 was $110 million, which represents 29.9% of total assets. Investments in U.S. Treasuries and Agencies account for 60.6% of investments and municipal securities account for 27.1% of investments, while interest-bearing bank balances and federal funds sold comprise the remaining 12.3% of the bank s total investments. There are no legal or financial constraints preventing FCB from meeting the credit needs of its assessment area in a manner consistent with its asset size, business strategy, resources, and local economy. 5

8 DESCRIPTION OF ASSESSMENT AREAS For the purpose of this CRA evaluation, FCB s delineated footprint covers nine counties in the following three assessment areas within the State of Ohio: Nonmetropolitan Ohio is comprised of Crawford, Marion, Ashland, Knox, and Wayne Counties Columbus, Ohio Metropolitan Statistical Area is comprised of Franklin, Morrow, and Delaware Counties Mansfield, Ohio Metropolitan Statistical Area is comprised of Richland County. At the previous performance evaluation, nonmetropolitan Ohio area was evaluated as two separate assessment areas. Due to limited lending volume, the nonmetropolitan Ohio assessment areas were combined to conduct a more meaningful analysis. The bank s delineated CRA assessment areas consist of 417 total census tracts, of which 35 (8.4%) are designated as low-income, 93 (22.3%) are moderate-income, 190 (45.6%) are middleincome, and 99 (23.7%) are upper-income tracts. 6

9 Lending Test CONCLUSIONS WITH RESPECT TO PERFORMANCE TESTS FCB s overall performance under the lending test is considered satisfactory. Lending performance in all three assessment areas was considered reasonable. Loan-to-Deposit Ratio A financial institution s loan-to-deposit ratio (LTD) compares the institution s aggregate loan balances outstanding to its total deposits outstanding. The ratio is a measure of an institution s lending volume relative to its capacity to lend and is derived by adding the quarterly LTD ratios and dividing by the total number of quarters. Below FCB s LTD ratio is compared to both the bank s aggregate peer group, consisting of all insured commercial banks having assets between $300 million and $1 billion, and three local peer banks from the Deposit Market Share Report. The following table illustrates FCB s quarterly LTD ratios along with the average LTD ratio for the bank and the peer. As of Date FARMERS CITIZENS BK Net Loans $000s Total Deposits $000s Loan-to-Deposit Ratios Bank LTD Ratio Aggregate Peer Ratio Peer 1 Ratio Peer 2 Ratio Peer 3 Ratio Mechanics Bank Wayne Savings Community Bank Fahey Banking Co March 31, , , December 31, , , September 30, , , June 30, , , March 31, , , December 31, , , September 30, , , June 30, , , March 31, , , Quarterly LTD Ratio Average Since the Previous Evaluation FCB s average LTD ratio was 68.23% over the past nine quarters since the previous evaluation, which is below the aggregate of all lenders average ratio of 74.81%. However, the bank s LTD ratio has increased consistently each quarter. Bank management attributed the increase to the opening of the loan production office in Dublin, Ohio. Additionally, FCB s LTD ratio was compared to the following local peer banks: Mechanics Savings Bank in Mansfield, Ohio; Wayne Savings Community Bank in Wooster, Ohio; and Fahey Banking Company in Marion, Ohio. Each of the local peer banks had less than 1.0% of the market share. While FCB s average LTD ratio is below these peer banks, FCB has seen a stronger positive trend and has been in line with peer results in the most recent quarters. Considering the bank s lending-related activity, size, financial condition, and assessment area credit needs, FCB s LTD ratio is considered reasonable. 7

10 Lending in the Assessment Area The bank s mortgage, small business, small farm, and consumer lending was analyzed to determine the volume of lending inside and outside the bank s assessment area. Of the bank s total loans, 75.9% by volume and 79.1% by dollar amount were made inside the assessment area. The following table shows the distribution of loans made inside and outside the bank s assessment area. Lending Inside and Outside the Assessment Area Loan Type - Description Inside Outside Total # % $(000s) % # % $(000s) % # % $(000s) % XX - ConsumerLoans , , Total Consumer related , , CV - Home Purchase - Conventional , , , FH - Home Purchase - FHA HI - Home Improvement MF - Multi-Family Housing , , , RF - Refinancing , , , Total HMDA related , , , SB - Small Business , , , Total Small Bus. related , , , SF - Small Farm , , , Total Small Farm related , , , TOTAL LOANS , , , A majority of the bank s loans by both volume and dollar amount were made inside its assessment area. 8

11 Geographic Distribution of Lending FCB s geographic distribution of lending is considered reasonable. The bank had significant lending gaps within each assessment area; however, the dispersion of loans among different tract income categories is adequate. The respective analyses are included within each assessment area evaluation later in this report. Borrower Distribution of Lending FCB s lending to borrowers of different income levels and businesses of different revenue sizes is reasonable. Residential lending, which received the greatest weight, is adequate. Small business and small farm lending are considered good while consumer lending is adequate. The respective analyses can be found within each assessment area discussion later in this report. Response to Consumer Complaints The bank has not received any CRA-related complaints since the previous examination. Community Development Test The community development test is considered satisfactory. The bank s community development performance demonstrates an adequate responsiveness to the needs of its assessment area through community development loans, qualified investments, and services, considering the bank s capacity and the need and availability of opportunities in the bank s assessment area. Community Development Loans During the review period, FCB originated three community development loans totaling $663,391 that benefited the nonmetropolitan assessment area. All three loans were generated under Ohio s Grow Now program, which promotes job retention and creation by supporting small business activities. Community Development Investments During this evaluation period, FCB funded one investment and made several donations aggregating $1,022,702. The bank received credit for one investment for $1.0 million in an Ohio equity fund for housing that promotes the construction, rehabilitation, and preservation of affordable housing throughout Ohio primarily through low-income housing tax credits (LIHTCs). Because the investment benefits all of Ohio, it was prorated based on the percent of the bank s deposits within each assessment area. Additionally, the bank made five donations totaling $22,702 that benefited the nonmetropolitan assessment area. 9

12 Community Development Services The bank does not have any branches located in low- to moderate-income geographies nor does it have branches in or reasonably accessible to each county within its assessment area. Its ATMs are attached to its branches and do not enhance the bank s distribution network. Details of the bank s branching distribution are discussed within the respective assessment area sections within this performance evaluation For a map of the bank s assessment area detailing its branch distribution, refer to Appendix A of this report. The bank provides few, if any, community development services to organizations within its delineated assessment area. Fair Lending or Other Illegal Credit Practices Review No evidence of discrimination or other illegal credit practices inconsistent with helping to meet community credit needs was identified. 10

13 DESCRIPTION OF THE INSTITUTION S OPERATIONS IN NONMETROPOLITAN OHIO (Full-Scope Review) The nonmetropolitan Ohio assessment area consists of Crawford, Marion, Knox, Ashland, and Wayne Counties. This assessment area consists of 86 total census tracts, of which none are designated as low-income, four are moderate-income (4.7%), 69 are middle-income (80.2%), and 13 are upper-income (15.1%) geographies. The bank s main office and one branch are located in Crawford County. There is one branch in Knox County and there are no branches in Marion, Ashland, and Wayne Counties. None of the middle-income census tracts are listed on the Federal Financial Institutions Examinations Council s list of distressed nonmetropolitan middle- income geographies, as defined by the Community Development Financial Institutions for Crawford County is located in north central Ohio, approximately 28 miles west of Mansfield. Bucyrus is the largest city and county seat in Crawford County and the center of the Bucyrus Micropolitan Statistical Area. The county had a population of 43,784, according to the 2010 Census. Knox County is located in central Ohio and sits immediately south of Richland County, approximately 15 miles from Mansfield. Mount Vernon is the largest city and county seat of Knox County. The county had a population of 60,921, according to the 2010 Census, and is included in the Mount Vernon Micropolitan Statistical Area. Marion County is also located in north central Ohio and is approximately 50 miles north of Columbus. Marion is the county seat and the largest city in Marion County and the center of the Marion Micropolitan Statistical Area. The county had a population of 66,501, according to the 2010 Census. In addition, Marion County is also part of Ohio s Columbus-Marion-Chillicothe Combined Statistical Area (CSA). The CSA has an estimated population of 2.1 million people, according to 2010 U.S. Census estimates. Ashland County is located in north central Ohio and sits immediately east of Richland County, approximately 15 miles from Mansfield. Ashland is the largest city and county seat of Ashland County. The county had a population of 53,139, according to the 2010 Census, and is included in the Ashland Micropolitan Statistical Area. Wayne County is located in north central Ohio and is approximately 22 miles east of Mansfield. Wooster is the county seat and largest city in Wayne County. The county has a population of 114,520, according to the 2010 Census, and is included in the Wooster Micropolitan Statistical Area. 11

14 According to the FDIC Deposit Market Share Report, as of June 30, 2012, FCB s market share of deposits accounts for 3.51% of the market and ranks 8 th, operating three offices out of 33 institutions operating 138 offices in the assessment area. The top two institutions in this market are PNC Bank NA with 16.94% of the market and Park National Bank with 15.21% of the market. Rounding out the top five institutions in this market are FirstMerit Bank NA, First National Bank, and Wayne Savings Community Bank with 11.22%, 6.12%, and 5.89% of the market share, respectively. By comparison, in Crawford County, where FCB operates two offices (including its main office), FCB ranks second out of nine institutions, operating 22 offices with 16.73% of the market share. 1 One community contact interview was conducted to provide additional information regarding credit needs of the local community. The community contact is involved with land development in Marion County and stated that the area was hit hard over the last decade and suffered with job loss and foreclosures. According to the contact, although things are improving with the renovation of the North Bypass and the growth of industrial jobs due to the expansion of industrial parks like Whirlpool, consumers and businesses are having difficulty obtaining financing despite being creditworthy. However, several banks in the area are participating in programs that support transitional housing, downtown revitalization, and small business lending efforts. Population Characteristics According to the 2000 U.S. Census, the total population in this market is 331,770. Approximately, 4.2% of the assessment area s population resides in moderate-income tracts, while 82.2% reside in middle-income tracts and 13.6% reside in upper-income tracts. In addition, 74.0% of the population is 18 years of age or older, which is the legal age to enter into a contract. The table below shows the projected population by county in this assessment area over the next two census periods: 2 County Actual 2000 Actual 2010 Projected Population 2020 Projected Population 2030 Crawford 46,966 43,784 44,260 43,390 Marion 66,217 66,501 67,190 68,200 Knox 54,500 60,921 65,940 69,890 Ashland 52,523 53,139 59,010 61,050 Wayne 111, , , , FDIC Summary of Deposits, 2 Ohio Department of Development, 12

15 Income Characteristics According to 2000 U.S. Census data, the median family income in this assessment area was $46,116, compared to Ohio s median family income at $50,037 and Ohio s non-metropolitan median family income at $43,801. Based on 2011 HUD data, Ohio s non-metropolitan median family income increased to $52,900, a 20.8% increase. 3 The assessment area contains 123,496 households, of which 88,919 (72.0%) are designated as families. Low- and moderate-income families represent 15.08% and 18.5% of all families in this assessment area, respectively, with 6.7% of families below the poverty level, compared to Ohio s rate at 7.8%. Based on 2011 data from the Economic Research Service of the United States Department of Agriculture (USDA), household poverty rates for the counties in the assessment area were as follows: 4 County 1999 Poverty Rate 2011 Poverty Rate Change Crawford 10.4% 17.3% % Marion 9.7% 18.4% % Knox 10.1% 14.5% % Ashland 9.5% 13.1% % Wayne 8.0% 13.7% % Ohio 10.6% 16.3% % United States 11.3% 15.1% * % *U.S. poverty rate in 2010 Poverty rates have increased in a meaningful way across all counties in the assessment area, in many cases at a higher rate than in the state or country. Labor, Employment, and Economic Characteristics The following table illustrates the largest percentage of land use in each county in the assessment area: 5 Urban Cropland Pasture Forest Crawford County 4.8% 79.5% 3.8% 10.7% Marion County 7.5% 80.1% 2.6% 7.3% Knox County 3.5% 43.7% 12.7% 39.1% Ashland County 2.3% 48.0% 11.0% 37.2% Wayne County 5.3% 59.6% 11.6% 22.5% 3 Department of Housing and Urban Development, 4 U.S. Department of Agriculture, 5 Ohio Department of Development, 13

16 Cropland and pasture, which comprise the greatest land use in each of the counties in the assessment area, consists primarily of soybean and corn crops and livestock. 6 With the significant agricultural focus, there is limited land available for business and residential use in each county, which indicates that FCB may have limited opportunities to make business- and residential-type loans within this assessment area. Major employers in the bank s assessment area include: 7 Crawford County Marion County Knox County Ashland County Wayne County Bucyrus Precision Tech, Crawford County Government, Galion City Schools, Galion Community Hospital, General Electric Co., Imasen Bucyrus Technology, PPG Industries, Inc., Timken Co. Anderson Corporation, ConAgra Foods, Frontier Communications, General Mills, Marion City Schools, Marion County Government, Marion General Hospital, Nucor Corporation, Smith Clinic, State of Ohio, Whirlpool Corporation, Wyandot Ariel Ltd, FT Precision, JELD-WEN Inc, Kenyon College, Knox Community Hospital, Kokosing Construction Co, Mount Vernon Nazarene University, Mt Vernon City Schools, Rolls-Royce plc, Sanoh America Inc, State of Ohio Ashland City Schools, Ashland University, Mansfield Plumbing Products LLC, McGraw-Hill Companies, Pentair Pump Group Inc, Samaritan Regional Health System, Snyder s-lance Inc, State of Ohio, Step2 Co, Wil Research Laboratories Buehler Food Markets Inc., College of Wooster, Frito-Lay Inc., JLK Industries, JM Smucker Co, LuK Inc., State of Ohio, Will-Burt Co, Wooster Brush Co, Wooster City Schools, Wooster Community Hospital, Worthington The primary sectors for employment are manufacturing; trade, transportation, and utilities; education and health; leisure and hospitality; and local government. Employment of wage and salary workers is expected to increase from in the areas of healthcare, trade, local government, leisure and hospitality, educational services, and transportation and utilities, while declining for manufacturing. 8 The following chart shows the 2010 and 2011 average annual unemployment rate for the counties in the assessment area and reflects a positive trend over the two-year period Ashland Co Crawford Co Knox Co Marion Co Wayne Co Ohio Not Seasonally Adjusted Unemployment Rates Assessment Area: Non Metro Ohio Combined Area Years - Annualized 6 USDA The Census of Agriculture, Industry Employment, U.S. Bureau of Labor Statistics, 14

17 Housing Characteristics There were 131,425 housing units in this assessment area, based on the 2000 U.S. Census. Within this assessment area, 69.4% of the units were owner-occupied, 24.6% were rental units, and 6.1% were vacant. From an income perspective, only 3.2% of all owner-occupied housing units are located in moderate-income census tracts, suggesting limited opportunity for mortgage credit in moderate-income geographies. The median age of housing stock was 40 years as of the 2000 U.S. Census, with 36.7% of housing built prior to Older homes such as these are typically more likely to require repairs and rehabilitation. The median housing value in the assessment area was $92,139, with an affordability ratio of 42.7%. 9 The affordability ratio is derived by dividing the median household income by the median housing value. The higher the affordability ratio, the more affordable a home is considered. The majority of homes (57.2%) in this assessment area were valued below $100,000. Further, based on the 2000 median family income for nonmetropolitan Ohio ($46,116), approximately 43.0% of the homes valued up to $84,500 in the assessment area would be considered affordable for low-income individuals and 75.2% of the homes valued up to $135,200 would be considered affordable for moderate-income individuals. These percentages were calculated assuming a housing expense ratio equal to 28.0% of gross income for a 4.0% fixed-rate, 30-year loan. Affordability ratios using 2010 U.S. Census data are provided in the chart below A ratio of 100.0% indicates that median-family income is just sufficient to purchase the median-priced home. When the ratio falls below 100, the typical household has less income than necessary to purchase the typical house. 10 US Census Bureau: American FactFinder, American Community Survey 5-Year Estimates 15

18 According to Sperling s Best Places, the 2010 median home cost, provided in the following table 11, demonstrates that housing values are beginning to rebound slightly from the depreciated levels experienced in most recent years. Major City in Each County 2012 Home Values % Appreciation in Prior Year Bucyrus (Crawford) $ 65, % Marion (Marion) $ 79, % Mount Vernon (Knox) $101, % Ashland (Ashland) $ 79, % Wooster (Wayne) $114, % According to RealtyTrac, over 10,000 foreclosure filings were reported on Ohio properties in March In March, the number of properties that received a foreclosure filing in Ohio was 2.0% higher than the previous month and 27.0% higher than the same time last year. Home sales in Ohio for February 2013 were down 11.0% compared with a year ago. Ohio currently ranks among the top five states in the country for monthly foreclosure filings, with one in every 477 Ohio households receiving a foreclosure notice in March Crawford County ranks among the top five counties in Ohio for monthly foreclosure filings. The following table shows the number of foreclosures, along with the ratio of properties receiving foreclosure notices in March County Foreclosed Properties in March 2013 Ratio of Properties Receiving Foreclosure Filings in March 2013 Crawford 56 1:360 Marion 37 1:536 Knox 39 1:641 Ashland 27 1:819 Wayne 65 1:705 Ohio 10,731 1:477 From a rental perspective, the median gross rent in the assessment area was $471, with 21.2% of the rental units having rents of less than $350 a month, according to the 2000 U.S. Census. The majority of rents (29.6%) in this assessment area were $500-$699 per month and 29.3% of rents were $350-$499. Slightly less than 10.0% of rents were greater than $700. Almost 25.0% of housing units in this assessment area are rental units. Additionally, 29.3% of renters have rent costs greater than 30.0% of their income. 11 Sperling s Best Places, 16

19 17

20 Lending Test CONCLUSIONS WITH RESPECT TO PERFORMANCE TESTS IN NONMETROPOLITAN OHIO Lending performance in the nonmetropolitan Ohio assessment area is considered to be reasonable. Geographic Distribution of Lending Geographic distribution in this assessment area received less weight than borrower distribution based on the assessment area having no low-income census tracts and only four (4.7%) moderate-income tracts. The gap analysis revealed significant lending gaps within this assessment area. FCB did not make loans in 62 of the 86 (72.0%) total tracts. In particular, FCB did not originate loans in any of the four moderate-income tracts; however, FCB only has three branches to serve the entire assessment area. Two branches are located in middle-income tracts and one is located in an upper-income tract. All of the branches are at least 15 miles away from the nearest moderateincome tract, as shown in the table below. County # of Branches Distance from FCB Branch to Moderate- Income Tract Distance from County Center to Nearest FCB Branch Portion of County Served Crawford 2 15 NA Southwest/Central Marion 0 NA 17 miles NA Knox 1 30 NA Northwest Ashland 0 NA 23 miles NA Wayne 0 NA 47 miles NA Based on the limited number and distance of the branch offices, in addition to the high level of competition in this area, it appears that FCB has limited lending opportunities across all product categories. Additionally, FCB s gap in lending performance in moderate-income tracts does not differ significantly from peer performance; therefore, geographic distribution of lending is considered adequate. Consumer Lending As shown in the graph below, FCB made no consumer loans in moderate-income tracts. The percent of loans made to borrowers in middle-income tracts exceeded the number of households (proxy) in such tracts. In upper-income tracts, the bank made fewer loans than the proxy. Therefore, geographic distribution of consumer loans is adequate. 18

21 As shown in the graph below, FCB made no residential loans in moderate-income tracts, which is reasonable when compared to the limited number of owner-occupied units in these tracts and low level of lending by peer. Residential lending in middle-income tracts fell slightly below the proxy (owner-occupied households) and the aggregate of all lenders (peer) performance. In upper-income tracts, the bank significantly exceeded both the proxy and peer results. Therefore, geographic distribution of residential loans is considered adequate. As depicted in the following graph, the bank made no small business loans in moderate-income tracts, which is reasonable when compared to the limited number of businesses in these tracts and low level of lending by peer. However, FCB s lending was comparable to small business lending performance when compared to the number of small businesses (proxy) and the peer in middle-income tracts. FCB exceeded both the proxy and peer in upper income tracts. Therefore, geographic distribution of small business lending is considered adequate. 19

22 As shown in the graph below, FCB was only slightly below the proxy in middle-income tracts and below the peer performance. In upper-income tracts, the bank s performance exceeded both the proxy and peer. The bank made no small farm loans in moderate-income tracts, which is reasonable given the small percentage of farms in these tracts. The peer also made no loans in these tracts. Therefore, the geographic distribution of small farm lending is considered adequate. 20

23 Borrower Distribution of Lending Based on lending volume, more weight was given to residential and small farm lending when considering borrower distribution in this assessment area. Overall, FCB s borrower distribution of lending performance in nonmetropolitan Ohio is considered adequate. Consumer Lending FCB s borrower distribution of consumer lending is considered adequate. As shown in the following chart, FCB s consumer loans to low-income borrowers substantially exceeded the percentage of households (proxy), while it substantially fell below the proxy for moderateincome borrowers. The bank exceeded the proxy for both middle- and upper- income households. Residential Lending The following chart exhibits FCB s borrower distribution for residential loans is adequate. FCB s borrower distribution was substantially below the percentage of families (proxy) and the aggregate of all lenders (peer) for low-income borrowers and was below the proxy and peer for moderate-income borrowers. The bank substantially exceeded the proxy and peer lending to middle-income borrowers and was slightly below for upper-income borrowers. It should be noted that 10.3% and 12.2% of incomes for the bank and peer, respectively, are unknown. 21

24 Small Business Lending Small business lending, although receiving less weight based on a small sample size, shows poor lending performance (40.0%) to businesses with revenue of $1 million or less compared to the percentage of businesses (90.7%) in the assessment area. However, the bank s level of lending is consistent with peer performance in the area (43.9%). Further analysis of small business lending shows 40.0% of the bank s small business loans were for $100,000 or less. Typically, the extent to which a bank is willing to extend loans in amounts of $100,000 or less is reviewed because smaller businesses often have a greater need for smalldollar loans. This demonstrates a poor responsiveness to meeting the credit needs of small businesses in this area. 22

25 Small Farm Lending Small farm lending borrower distribution performance is considered good, with FCB having made 93.8% of its farm loans to farms with revenue size less than $1 million, as shown in the chart below. This is slightly less than the proxy (number of small farms with revenue under $1 million) and exceeds peer performance of 80.8%. Additionally, as depicted in the loan size distribution chart above, 46.9% of the bank s small farm loans were for $100,000 or less. This demonstrates an adequate responsiveness to meeting the credit needs of small businesses in this area. 23

26 Community Development Test FCB demonstrated an overall adequate level of responsiveness as relates to community development lending, investments, and services considering the bank s capacity and the need and availability of such opportunities in this assessment area. Community Development Loans During this review period, FCB generated three community development loans in this assessment area aggregating $663,391. All three loans were generated under Ohio s Grow Now program, which promotes job retention and creation by supporting small business activities. Two of the community development loans were to a farming business in Orville, Ohio, located in Wayne County. The funds supported the ongoing operations of the farm and the retention of two entry-level laborers. The third loan was made to a technology company in Crestline, Ohio, located in Crawford County, to support expanding the business and included the addition of one entry-level job. Community Development Investments Nonmetropolitan Ohio received credit for a portion of an investment totaling $509,800. The investment was made to an Ohio equity fund for housing that promotes the construction, rehabilitation, and preservation of affordable housing throughout Ohio, primarily through lowincome housing tax credits (LIHTCs). Additionally, the bank made $22,702 in donations benefiting five organizations in Crawford County that serve low- and moderate-income individuals or provide community services in lowor moderate-income tracts. Community Development Services As shown in the table below, FCB has a total of three branches in this assessment area. As stated earlier, the moderate-income census tracts in the assessment area are not in proximity of an FCB branch and the bank only has a branch presence in two of five counties in this assessment area. See Appendix A for a map of the assessment area with branches. Geography # of Branches Branch and ATM Distribution Percent # of ATMs Percent Percent of Families by Tract Income Small Businesses by Tract Small Farms by Tract Moderate-Income 0 0.0% 0 0.0% 4.0% 4.5% 0.4% Middle-Income % % 82.0% 81.0% 80.6% Upper-Income % % 14.0% 14.5% 19.1% Total % % 100.0% 100.0% 100.0% Regarding community development services, a bank employee gave a presentation to several small farmers regarding the FSA loan program. 24

27 DESCRIPTION OF THE INSTITUTION S OPERATIONS IN COLUMBUS MSA (Full-Scope Review) The Columbus MSA is comprised of the following eight counties: Delaware, Fairfield, Franklin, Licking, Madison, Morrow, Pickaway, and Union. However, FCB s assessment area is comprised of Franklin, Morrow, and Delaware Counties. This assessment area consists of 299 total census tracts: 34 (11.4%) low-income, 81 (27.1%) moderate-income, 104 (34.8%) middleincome and 80 (26.8%) upper-income geographies. There are two branches located in Franklin County and one in Morrow County. There are no branch locations within Delaware County; however, this county is in between Franklin and Morrow Counties, making this assessment area contiguous. According to the U.S. Census Bureau s report on population change for large MSAs and rankings, the Columbus MSA is the third-largest metropolitan area in Ohio, behind Greater Cincinnati and Greater Cleveland. The Columbus MSA grew 13.9% between the 1990 and 2010 Censuses and is the nation s 32 nd largest MSA. 12 As of the 2010 U.S. Census, the MSA s population totals 1.9 million residents, of which 1.2 million (63.2%) reside in Franklin County, making it the largest county in the Columbus MSA. Columbus in Franklin County is the largest city in Ohio and the nation s 15 th largest city, according to the Census Bureau s most recent population estimates. Columbus has approximately 787,083 residents, which represents about 68.0% of Franklin County s total population using 2010 Census data. Morrow County is located 41 miles north of Columbus. The population of the county was 34,827 as of the 2010 Census. Mt. Gilead is both its largest city and county seat. Delaware County is located 20 miles north of Columbus. Delaware is both its largest city and county seat. According to the latest U.S. Census population data, Delaware County continues to be the fastest-growing county in Ohio, with a population increase of 58.4% between the 2000 and 2010 Censuses. According to the FDIC Deposit Market Share Report, as of June 30, 2012, FCB s market share of deposits accounts for 0.34% of the market. FCB ranks 18 th operating three offices out of 41 institutions operating 422 offices in this assessment area. The top five institutions in this market are Huntington National Bank, JPMorgan Chase Bank NA, PNC Bank NA, Fifth Third Bank, and Nationwide Bank, with 83.43% of the market share and operating 245 offices. 13 By comparison, in Franklin County, where it operates two offices, FCB ranks 18 th out of 34 institutions operating 353 offices with 0.3% of the market share. In Morrow County, where it operates one office, FCB ranks fourth out of five institutions operating seven offices with 16.8% of the market share FDIC Summary of Deposits, 25

28 One community contact interview was conducted with a non-profit organization providing affordable housing to low- and moderate-income individuals. The contact stated that Columbus has several high-minority, low-income, blighted neighborhoods that tend to have high vacancy rates; very little livable, up-to-code, affordable housing; high unemployment rates; and high crime rates. The contact indicated that large financial institutions have a presence in the area and have provided funding for the rehabilitation and renovation of existing properties. According to the contact, there is a great need for affordable housing in the Columbus area. The contact also stated that several large financial institutions participate in the organization s affordable housing program. This program assists low-income women and minorities in particular to become firsttime homeowners by obtaining access to low-interest loans and homeownership counseling and education. Population Characteristics According to the 2000 U.S. Census, the total population in this assessment area is 1.2 million. Approximately 8.5% of the assessment area s population resides in low-income tracts and 23.3% of the population resides in moderate-income tracts. The majority of the population (37.3%) resides in middle-income tracts and 30.8% of the population resides in upper-income tracts. In addition, 74.6% of the population is 18 years of age or older, which is the legal age to enter into a contract. The total population in 2010 remained unchanged. The table below shows the projected population by county in this assessment area over the next two census periods: 14 County Actual 2000 Actual 2010 Projected Population 2020 Projected Population 2030 Franklin 1,068,078 1,163,414 1,238,250 1,326,180 Morrow 31,628 34,827 36,890 38,650 Delaware 109, , , ,200 Income Characteristics The assessment area was comprised of 490,167 households, of which 305,041 (62.2%) are families. The median family income as of the 2000 U.S. Census was $55,388. The median family income for the counties in the assessment area fluctuated between a high of $76,453 in Delaware County to $53,905 in Franklin County and $45,747 in Morrow County. For comparison, the Columbus MSA s median income increased to $66,600, based on 2011 HUD data. Low- and moderate-income families represented 19.6% and 17.7% of all families in this assessment area. Of the total families, 7.6% were below the poverty level, compared to Ohio s rate at 7.8%. Based on 2011 data from the Economic Research Service of the United States Department of Agriculture (USDA), household poverty rates for the counties in the assessment area were as follows 15 : 14 Ohio Department of Development, 15 US Department of Agriculture, 26

29 County 1999 Poverty Rate 2011 Poverty Rate Change Franklin 11.6% 18.8% % Morrow 9.0% 13.7% % Delaware 3.8% 4.5% % State of Ohio 10.6% 16.3% % United States 11.3% 15.1% * % *U.S. poverty rate in 2010 Labor, Employment, and Economic Characteristics The following table illustrates land use in each county in the assessment area: 16 Urban Cropland Pasture Forest Franklin County 61.1% 22.7% 1.5% 13.6% Morrow County 2.9% 65.4% 3.1% 28.4% Delaware County 16.6% 52.6% 2.6% 25.8% FCB is located in proximity to the land available for business use and residential properties in Franklin and Delaware Counties, which indicates that the bank has more-than-reasonable opportunities to make business- and residential-type loans within this assessment area. In 2012, Ohio was home to 28 Fortune 500 companies, of which six are located in central Ohio. Cardinal Health of Dublin, a $108 billion manufacturer and distributor of medical and surgical supplies and pharmaceuticals, remains the state's biggest company and ranks 21 st in the Fortune 500. Nationwide, the Columbus-based insurance company, is ranked 100 th. Other central Ohio companies listed are American Electric Power (176 th ), Limited Brands (256 th ), Momentive Specialty Chemicals (452 nd ), and Big Lots (467 th ). 17 In addition to the Fortune 500 companies listed above, other major employers in the bank s assessment area include: Franklin County Abbott Laboratories, Battelle Memorial Institute, Huntington Bank, JP Morgan Chase, Ohio State University, OhioHealth, PNC Financial Services, Schottenstein Stores, State of Ohio, The Wendy s Company Morrow County Berkshire Hathaway/Scott-Fetzer/Stahl, Cardington-Lincoln Local Schools, Core Systems, Highland Local Schools, Kroger Co., Morrow County Hospital, Mt. Gilead Exempted Village Schools, Northmor Local Schools, Yutaka Giken/Cardington Yutaka Corp Delaware County Delaware City Schools, Emerson/Liebert, JP Morgan Chase, Kroger Co, McGraw Hill Companies, Mettler-Toledo International, Ohio Wesleyan University, OhioHealth/Grady Memorial Hospital, Olentangy Local Schools, PPG Industries, Showa Corp/American Showa, State of Ohio 16 Ohio Department of Development,

30 The 2010 annual average unemployment rate, according to the Ohio Department of Job and Family Services, was 8.6% for Franklin County, 10.4% for Morrow County, and 7.1% for Delaware County. Unemployment rates in these counties show a positive trend from 2010 to 2011, as depicted in the following chart. Housing Characteristics There were 525,522 housing units in the assessment area, with the vast majority of units (471,016) or 89.6% located in Franklin County, based on the 2000 Census. Within the assessment area, 55.4% of the units were owner-occupied, 37.9% were rental units, 22.5% were multi-family, and 6.8% were vacant. Franklin County had the lowest owner-occupancy rate at 53.0%. Delaware and Morrow Counties each had owner-occupancy rates over 75.0%. For comparison, the owner-occupancy rate in the Columbus MSA was 59.0% and 64.3% in Ohio. From an income perspective, 33.6% of housing units and 21.5% of owner-occupied homes were located in either low- or moderate-income census tracts. These figures suggest mortgage credit demand in Franklin County and low- and moderate-income areas may be lower. Additionally, a significant concentration of multi-family homes is located in low- (32.4%) and moderate- income (28.9%) census tracts, with 24.1% of all multi-family housing located in Franklin County. The median age of housing stock was 30 years as of the 2000 U.S. Census, with 19.2% of housing built prior to Older homes such as these are typically more likely to require repairs and rehabilitation. In particular, the median age of housing stock was 30 years in Franklin County, 29 years in Morrow County, and 11 years in Delaware County. According to the 2000 U.S. Census data, the median housing value in the assessment area was $118,697, with an affordability ratio of 37.5%. The affordability ratio is derived by dividing the median household income by the median housing value. The higher the affordability ratio, the more affordable a home is considered. Affordability ratios were 37.6% in Franklin County, 42.1% in Morrow County, and 35.8% in Delaware County, whereas the affordability ratio for the MSA was 38.0% and 40.8% for Ohio. 28

31 Only 38.9% of homes in this assessment area were valued below $100,000 and 32.6% of homes were valued at $150,000 or more. Further, based on the 2000 median family income for the Columbus MSA ($55,388), approximately 39.8% of the homes valued up to $101,500 in the assessment area would be considered affordable for low-income individuals and 71.4% of the homes valued up to $162,400 would be considered affordable for moderate-income individuals. These percentages were calculated assuming a housing expense ratio equal to 28.0% of gross income for a 4.0% fixed-rate, 30-year loan. Affordability ratios using 2010 U.S. Census data are provided in the chart below median home values were above $100,000 in all three counties and above $150,000 in Franklin and Delaware Counties, resulting in low affordability ratios. However, homes are slightly more affordable than they were in According to Sperling s Best Places, the 2010 median home cost in the following cities in this assessment area is provided in the table below. Even though the Columbus housing market experienced a slight appreciation in the last year, the housing values have depreciated throughout this assessment area since the previous evaluation. Major City in Each County 2010 Home Values % Appreciation in Last Year Columbus (Franklin) $ 89, % Cardington (Morrow) $ 91, % Delaware (Delaware) $147, % 29

32 According to RealtyTrac, Franklin County continues to rank first in the overall number of foreclosure filings in Ohio (in front of Cuyahoga, Hamilton, and Summit Counties). The following table shows the number of foreclosures by rank and foreclosure rates by county in this assessment area as of March 2013: 18 County Foreclosed Properties in March 2013 Ratio of Properties Receiving Foreclosure Filings in March 2013 Franklin 1,886 1:279 Morrow 15 1:937 Delaware 129 1:508 Ohio 10,731 1:477 From a rental perspective, the median gross rent in the assessment area was $596, with 10.6% of the rental units having rents of less than $350 a month, according to the 2000 U.S. Census. Another 19.3% of rental units had rents of $350 to less than $500 per month. The majority of rents in the assessment area were $500-$699 or greater than $700 at 37.9% and 29.5%, respectively. Additionally, 34.8% of renters have rent costs greater than 30.0% of their income. Franklin County had the highest rent costs, where 35.1% of renters had rent costs greater than 30.0% of their income. 18 RealtyTrac.com/trendcenter/oh-trend.html 30

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34 Lending Test CONCLUSIONS WITH RESPECT TO PERFORMANCE TEST IN COLUMBUS, OHIO MSA FCB s lending performance in the Columbus MSA is reasonable. In this evaluation, residential loans received the greatest weight based on loan sample size. Due to a lack of volume to conduct a meaningful analysis, consumer loans and small farm loans were not evaluated in this assessment area. Geographic Distribution of Lending Overall, FCB s distribution of loans among geographies is considered adequate. FCB has two branches and a loan production office that are located in upper-income tracts (Franklin County) and a third branch in a middle-income tract (Morrow County). The gap analysis revealed significant lending gaps in the assessment area. During the evaluation period, the bank only made loans in 47 of the 299 (15.7%) census tracts in the assessment area. Of the 252 tracts without lending, 30 of 34 (88.2%) low-income tracts, 75 of 81 (92.6%) moderate-income tracts, 95 of 104 (91.3%) middle-income tracts, and 52 of 80 (65.0%) upper-income tracts did not have loans. These gaps can be attributed to the fact that a majority of the low- and moderate-income tracts are located around Columbus, while two of the bank s branches are located in the far northwestern portion of Franklin County and the other branch is located in Morrow County, which has only has one moderate-income tract. Residential Lending FCB s geographic distribution for residential lending in the Columbus MSA is good. As indicated in the chart below, residential lending in low-income tracts exceeded both the owneroccupied households (proxy) and the aggregate of all lenders (peer). In the moderate-income tracts, lending fell slightly below the proxy and substantially exceeded peer. This is notable considering that the bank competes with 404 other HMDA reporters in this assessment area. The loan production office, which opened in 2011, has allowed the bank to proactively target lowand moderate-income tracts and has bolstered performance in these geographic areas. In the middle-income tracts, performance was below the proxy and peer, while in upper-income tracts, the bank exceeded the proxy, but was significantly below peer comparison. 32

35 Small Business Lending Small business lending by tract is considered adequate. The bank substantially exceeded the number of businesses (proxy) and the peer in low-income tracts; however, FCB fell substantially below the proxy and peer in moderate-income tracts. The bank s lending fell below the proxy and peer in middle-income tracts, but significantly exceeded these comparisons in upper-income tracts. Borrower Distribution of Lending FCB s lending performance reflects an adequate distribution of lending to borrowers of different income levels and an excellent level of lending to businesses of different revenue sizes. 33

36 Residential Lending The following chart shows FCB s borrower distribution for residential loans is adequate. FCB s borrower distribution was substantially below the percentage of families (proxy) and below the peer for low-income borrowers. The borrower distribution for moderate-income borrowers was below the proxy and peer. Lending to middle-income borrowers was below the proxy and exceeded peer. Lending to upper-income borrowers exceeded the proxy and was slightly below peer. Income for 25.0% of the bank s residential lending was not available. Small Business Lending Small business lending is considered excellent. All of FCB s small business loans in the MSA were originated to businesses with revenues of $1 million or less. This compares quite favorably to the 89.5% of businesses of this size and to peer performance of 33.1%. 34

37 Further analysis of small business lending shows that only 25.9% of the bank s small business loans were for $100,000 or less. Typically, the extent to which a bank is willing to extend loans in amounts of $100,000 or less is reviewed because smaller businesses often have a greater need for small-dollar loans. With 100.0% of its loans going to businesses under $1 million in revenue, the loan size distribution chart below indicates that the bank is meeting the credit needs of these businesses with loans of various sizes. Community Development Test FCB demonstrated an adequate level of responsiveness as relates to community development lending, investments, and services considering the bank s capacity and the need and availability of such opportunities in this assessment area. Community Development Loans The bank did not make any community development loans within the assessment area. Community Development Investments The Columbus MSA received credit for a portion of an investment totaling $458,900 that benefits an Ohio equity fund for housing that promotes the construction, rehabilitation, and preservation of affordable housing throughout Ohio, primarily through low-income housing tax credits (LIHTCs). 35

38 Community Development Services FCB has only three traditional branches in this assessment area. As detailed in the table below, the bank does not have branches or ATMs in low- or moderate-income tracts. One branch (Morrow County) is in a middle-income tract. The other two branches (Franklin County) are in upper income branches. The two ATMs are located with branch offices and do not enhance the bank s geographic reach. The bank does not have a presence in low- or moderate-income tracts. Furthermore, both of the bank s branches in Franklin County are located in the northwestern portion of the county. Additionally, the branch located in Morrow County is 20 miles from the center of Delaware County, where the bank does not have a branch. Geography # of Branches Branch and ATM Distribution Percent # of ATMs Percent Percent of Families by Tract Income Small Businesses by Tract Small Farms by Tract Low-Income 0 0.0% 0 0.0% 6.9% 7.2% 1.3% Moderate-Income 0 0.0% 0 0.0% 21.1% 16.3% 11.4% Middle-Income % % 38.8% 36.2% 56.1% Upper-Income % % 33.3% 40.3% 31.2% Total % % 100.0% 100.0% 100.0% The bank provided no qualified community development services in this assessment area. 36

39 DESCRIPTION OF INSTITUTION S OPERATIONS IN MANSFIELD MSA (Limited-scope Review) The Mansfield MSA consists of Richland County, and the bank s assessment area includes the entirety of Richland County. As of the 2010 U.S. Census, the MSA had a population of 128,852 and its largest city is Mansfield. This assessment area consists of 32 total census tracts, one low-income (3.1%), eight moderate-income (25.0%), 17 middle-income (53.1%), and six upperincome (18.8%) geographies. FCB operates one office in this assessment area, located in Shiloh, Ohio. According to the FDIC Deposit Market Share Report, as of June 30, 2012, FCB s market share of deposits accounts for 0.56% of the market and FCB ranks 13 th, operating one office out of 14 institutions operating 50 offices in this assessment area. The top five institutions in the market are Park National Bank, Mechanics Savings Bank, JPMorgan Chase Bank NA, KeyBank NA, and FirstMerit Bank NA with 76.89% of the market share and operating 33 offices. Between January 1, 2011 and December 31, 2011, FCB originated 10 HMDA loans and 24 CRA loans, representing 9.5% and 19.5% of the bank s total HMDA and CRA loans, respectively. Based on the bank s lending volume, a limited-scope review was conducted. Two community contact interviews were conducted to provide additional information regarding credit needs of the local community. The first community contact was with an economic development corporation that stated manufacturing and retail are growing in the area, especially manufacturing. Local companies have added several hundred jobs over the past 12 months; however, Mansfield still has a large number of low-income areas with limited employment opportunities. The contact also stated while there is new housing in Richland County, there is a large proportion of blighted housing stock. Housing rehabilitation can be costly and sometimes the most effective solution is to demolish blighted housing and turn the space into green space for public use. Lastly, the contact mentioned that while banks in the area make an effort to provide some financial literacy, such training is extremely lacking and would be very helpful. The second community contact was with a community development organization. The contact stressed that there is a definite need for credit counseling, foreclosure assistance, and first-time homebuyer counseling resulting from the foreclosure crisis. The contact also stated that while banks have been willing to lend, they are constrained by applicants lack of creditworthiness that can primarily be attributed to the poor economy and high unemployment in the area. Facts and data reviewed, including performance and demographic information, can be found in the core tables accompanying this report. The table on the following page shows the demographics for this assessment area using data from the 2000 U.S. Census. 37

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41 CONCLUSIONS WITH RESPECT TO PERFORMANCE TESTS IN MANSFIELD MSA The bank s lending performance in this assessment area is consistent with the bank s overall lending performance. The community development tests were consistent with performance in the bank s overall assessment area. The Mansfield MSA received credit for a portion of an investment totaling $31,300 that benefits an Ohio equity fund for housing that promotes the construction, rehabilitation, and preservation of affordable housing throughout Ohio primarily through low-income housing tax credits (LIHTCs). 39

42 APPENDIX A ASSESSMENT AREA MAPS Nonmetropolitan Ohio 40

43 Columbus MSA 41

44 Mansfield MSA 42

45 APPENDIX B LENDING TABLES 43

46 44

47 45

48 46

49 47

50 48